Strategies for Sustainable Entrepreneurship - Central Appalachian

56 Pages·2005·7.97 MB·English

Strategies for
Sustainable
Entrepreneurship
Prepared by the Central Appalachian Network
1 STRATEGIES FOR SUSTAINABLE ENTREPRENEURSHIP
Table of Contents
P. 3 FORWARD
P. 5 CENTRAL APPALACHIAN NETWORK MEMBERS
P. 7 CENTRAL APPALACHIAN NETWORK’S GOALS
P. 9 STRATEGIES INFORMED FROM PRACTICE
P. 29 POLICY INFORMED BY RESEARCH
P. 51 SELECTED BIBLIOGRAPHY
TABLE OF CONTENTS2
F
ORWARD
 e Central Appalachian region comprised of Kentucky, Ohio,
Tennessee, Virginia, and West Virginia contains the highest
concentration of economically distressed counties in Appalachia.
Traditional industries such as coal, timber, agriculture, and
manufacturing are no longer in demand, and Appalachia has struggled
for decades to defi ne a new economy. Popular solutions such as
industrial recruitment strategies and biotechnology clusters have not
created the hoped for success in this region’s rural communities.
 e Central Appalachian Network (CAN) has been meeting since
1993 to examine regional approaches to poverty alleviation.  e
nonprofi ts that make up the network have a shared focus on building
a healthy and sustainable regional economy through ecologically
sustainable rural development strategies, local self-reliance, and
innovative community building. CAN members have a strong history
of learning from each other and collectively building our knowledge
and strategies for rural economic development. We see that economic
revitalization for the region must result from a diverse new economy
that includes not only business attraction investments, but also most
importantly supports the region’s entrepreneurs and small businesses.
Markets for entrepreneurs’ products and services are usually not
confi ned by state boundaries; however, the policies and programs to
help entrepreneurs access markets often stop at state borders. CAN
believes that cross-border networks are essential to bringing about
policy changes that encourage entrepreneurship and microenterprise
development for the region. Regional strategies combined with local
business development will lead to healthy and economically viable
communities in Appalachia.
3 STRATEGIES FOR SUSTAINABLE ENTREPRENEURSHIP
With support from the W.K. Kellogg Foundation, the CAN network
has undertaken a three-year project to communicate to key stakeholder
audiences about the multi-state policy frameworks that are needed to
create a positive climate for rural entrepreneurs.  is project has included
policy research, meeting with experts and refl ecting on the decade of real
world work completed by CAN organizations.  is Regional Roundtable
is the culmination of this eff ort.  e Roundtable, also supported by the
Appalachian Regional Commission, has these goals:
• Defi ne and examine proven barriers to regional markets created by
state borders;
• Develop a Regional White Paper supporting entrepreneurship as a
viable economic development strategy for Central Appalachia;
• Intensify and expand the network to build long-term policy networks
that will include ongoing policy discussion to move forward policies
that support entrepreneurship and healthy communities; and
• Consider a multi-state pilot project for the region to demonstrate
strategies for removing barriers for entrepreneurs.
You will fi nd fi ve key strategies for supporting rural entrepreneurs
elaborated in this book. An entrepreneur’s story illustrates the success of
each strategy.  e concluding section off ers research on the importance
and eff ectiveness of the strategy and the essential role of public policy.
Please contact the Voinovich Center for Leadership and Public Aff airs at
Ohio University for a CD to view all footnotes and references documenting
our research.
 ank you for joining our conversation,
Central Appalachian Roundtable:
Policy Innovations for Sustainable
Entrepreneurship.
FORWARD4
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T C A N ������������
HE ENTRAL PPALACHIAN ETWORK ����
Rural Action
Rural Action is a membership-based organization working for the
development of just and sustainable communities in Appalachian
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Ohio. Rural Action organizes, trains, networks and supports citizens
for revitalization of their own communities. www.ruralaction.org
Institute for Local Government Administration and Rural
Development (ILGARD) at Ohio University’s Voinovich
Center for Leadership and Public Aff airs
Since 1981, ILGARD’s mission has been to improve the performance,
innovation and effi ciency of government; serve as an applied research
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center for state, regional and local policy issues; provide information
and technology services for increased regional competitiveness; and
serve as a public service learning laboratory for undergraduate and
graduate students. www.ilgard.ohiou.edu
Appalachian Center for Economic Networks (ACEnet)
ACEnet’s mission is to increase the capacity of local communities to
network, innovate and work together to create a strong sustainable
regional economy that has opportunities for all. www.acenetworks.org
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Mountain Association for Community Economic
Development (MACED)
MACED works with people in Kentucky and Central Appalachia
to improve the quality of life by creating economic opportunity,
strengthening democracy and supporting the sustainable use of
natural resources. www.maced.org
Jubilee Project, Inc.
Jubilee Project assists in the economic and social empowerment
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of people in Hancock County, Tennessee, and nine surrounding
counties through active programs in leadership development, � �� ��
youth development and economic development with a special
focus on microenterprise incubation assistance with artisans, youth,
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farmers and food product entrepreneurs. Jubilee Project also works
in local and regional coalitions to improve policies and resources for
entrepreneurial and community development and community food
security. http://jubileeproject.holston.org
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5 STRATEGIES FOR SUSTAINABLE ENTREPRENEURSHIP
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 e Conservation Fund’s Natural Capital Investment
Fund, Inc. (NCIF)
�������� NCIF works to hasten the rate of enterprise formation and business development
in rural West Virginia. NCIF provides debt and equity fi nancing to high-potential,
emerging natural resource-based businesses that will advance sustainable economic
development in West Virginia. www.wvncif.org, www.conservationfund.org
Center for Economic Options (CEO)
CEO is committed to improving the sustainable economic well being of
West Virginians, with a particular focus on people in rural areas who have
������������ YYNNooeerrwwkk historically been excluded from the economy. CEO’s strategy is to promote
economic self-reliance through business ownership by assisting small-scale
manufacturers and artisans with accessing lucrative markets for their products.
www.centerforeconomicoptions.org
Appalachian Sustainable Development (ASD)
ASD brings together citizens living in and near the watersheds of the Clinch and Powell
rivers to affi rm the need for development that is sustainable and benefi cial for nature and
people, and for culture and community. www.appsusdev.org
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U.S. Appalachia
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CENTRAL APPALACHIAN NETWORK MEMBERS6
CENTRAL APPALACHIAN NETWORK’S GOAL:
Policy Networks that Support Entrepreneurship
W T
HY ENTREPRENEURSHIP POLICY HE KEY COMPONENTS OF EFFECTIVE ENTREPRENEURSHIP POLICY

IS NEEDED
Entrepreneurship policy is not simply about providing support entrepreneurs. And fi nally, policy should sup-
 ere will always be successful entrepreneurs who technical assistance to individual fi rms, important as port organizations that play a catalyst role in helping
achieve their goals with little assistance. However, that may be. Even more important is policy that helps these collaborations succeed. Researchers have found
generating the numbers of entrepreneurs required to regions set up entrepreneur support systems.  ose that the capacity of local and regional policy makers
positively impact the regional economy requires en- systems build on the strengths and natural capital to generate such entrepreneurship policy is one of the
trepreneurship policy that will dramatically increase of the region, encouraging everyone to play a role in critical factors correlating to a robust economy.
the numbers of individuals that start up businesses, creating a supportive environment for entrepreneurs.
improve their chances for success and enhance their  is policy framework is both “top-down” and “bot- Entrepreneurship policy needs to help all entre-
ability to expand and create quality jobs. A compre- tom-up,” a process that uses the specifi c needs of preneurs—whether microenterprises or gazelles.
hensive shift to an “entrepreneurial culture” where all entrepreneurs and communities as the starting point. Networking microentrepreneurs into clusters that
stakeholders think and act to carry out a vision will Policy should help entrepreneurs and local organiza- emphasize regional fl avor, those businesses builds an
require more than research and ideas. New roles, new tions join together to develop clusters that can orga- extremely appealing environment and triggers creativ-
programs, rewards and economic infrastructure are nize joint marketing and product innovation. Policy ity in other businesses.  e result is an atmosphere that
needed.  is can only mean realigning resources at the should provide incentives for local communities to attracts and retains gazelles.
state, region, and federal level.
“Entrepreneurship policy should “State and local governments increasingly look to en-
be constantly shifting toward trepreneurship as a means of stimulating economic
ever-emerging opportunities.” growth. However, can the public sector play a role in
David M. Hart, The Emergence of
Entrepreneurship Policy promoting entrepreneurial activity—and if so, what
should that role be?”
Stephen J. Goetz and David Freshwater
7 STRATEGIES FOR SUSTAINABLE ENTREPRENEURSHIP
N
EW WAYS OF FORMING POLICY
Involve entrepreneurs and entrepreneurial initiatives. Government’s role in the policy process is Make policy regional.
communities in a network for to keep it fl uent and innovative and increase the adapt- Most researchers recommend a regional
ability of the whole process of economic and social approach that encourages the commu-
policy formation.
development.  e Federal Reserve Bank of Kansas nities and jurisdictions to partner so
Entrepreneurial and policy communities have much to
has identifi ed some of the new governance structures that a more robust, sustainable and
off er one another.  e involvement of entrepreneurs
that are being instituted both in the U.S. and Europe meaningful entrepreneurship strategy
in designing and supporting entrepreneurship policy
to generate the policy initiatives needed for economic can evolve. In a global economy,
makes the eff orts of policy-makers more politically
revitalization. sub-state regions as well as multi-
viable and economically eff ective. Groups of entrepre-
state regions can benefi t from the
neurs mobilized through clusters and networks have Make policy build regional assets.
development of entrepreneur-
the potential to bring relevant knowledge and requisite Policy should invest in assets that will continue to
ship policy that guides innovative
power to bear on the making of entrepreneurship poli- generate returns over time—endowed Innovation
collaborations. With a global
cy. In addition to entrepreneurs, the many universities, Funds; strong and sustainable Entrepreneur Support
economy, Central Appalachia
nonprofi t organizations, and agencies that are part of Organizations (ESOs); and clusters that help busi-
must restructure by turning to
regional entrepreneurship networks also have much to nesses expand and create jobs. Nonprofi t ESOs and
more competitive industries or
off er the policy making process. locally based public agencies need support to become
by making the existing industries
sustainable, allowing them to focus their eff orts on the
Make policy more fl exible and experimental. more competitive through policies
delivery of programs to build the enterprise develop-
Entrepreneurship policy should be extremely fl ex- aimed at improving economies of
ment system. Some of the most powerful changes in
ible to eff ectively support innovation. It should re- scale.  e Central Appalachian
Appalachia have taken place because of institutions
fl ect the innovative nature of entrepreneurship and Network believes that these poli-
that are strong enough and have enough staying power
encourage experimentation and change. In such a cies can be most eff ective when they
to off er critical services.
situation, there is no way to be assured of successful encourage collaboration, involve
policy in advance of trying it.  erefore, small diverse all stakeholders and work towards
experiments will tend to be more productive than large a comprehensive regional system to
support entrepreneurs.
“Good governance: policies that give invisible people a voice, crossing
traditional jurisdictional boundaries, building and sustaining
collaboration, achieving meaningful economic and social outcomes,
and applying past lessons to future initiatives.”
Chuck Fluharty
POLICY NETWORKS THAT SUPPORT ENTREPRENEURSHIP 8
9 STRATEGIES FOR SUSTAINABLE ENTREPRENEURSHIP